After a board meeting early Friday morning, Citigroup’s
management and some board members held several calls with
Henry M.
Paulson, the Treasury secretary, and with the head of the
Federal
Reserve Bank of New York, Timothy F. Geithner, who hours
later emerged as President-elect Barack Obama’s
choice to be Treasury secretary.

As Citigroup’s stock sank, falling 94 cents to $3.77, the
Federal
Reserve was carefully monitoring how much money corporations
and other customers were withdrawing from the bank, people
involved in the discussions said. The Fed was trying to ascertain
whether the tumult in the stock market could escalate into
something worse.

So far, however, these people said, most customers and clients
remained committed to Citigroup.

Translation: Some customers and clients are running for
this hills. More will decide to do so over the weekend.

On Sunday, Citigroup plans to run full page advertisements in
major metropolitan newspapers that acknowledge “our financial
markets have been tested in unprecedented ways,” but arguing that
it has the diversity and experience to pull through. In a nod to
the company’s slogan, the ad concludes: “That’s why now, more
than ever, you can feel confident that Citi never sleeps.”

Absurd. Meanwhille, within Citigroup, some executives are
reportedly blaming the government. If only the Feds hadn't
allowed Wells Fargo to steal Wachovia out from under them none of
this would have happened.